NY Single-Payer Health Care Would Save City $80 Million a Year

Green Party candidates for city offices said today that the city and school district would save $80 million a year if the New York Health Act is adopted.

The New York Health Act would set up a universal health insurance plan covering all New Yorkers for all medically necessary services. It would be paid for by a single public payer financed by progressively graduated taxes on payrolls and non-payroll income in New York and federal funds now received by New York for Medicare, Medicaid, Family Health Plus, and Child Health Plus. 98% of New Yorkers would pay less on health care than they do now, with those earning less than $100,000 a year seeing the largest savings.

The $80 million annual savings would more than cover the $15 million a year recurring deficit the city operations budget faces with less than $20 million projected to be remaining in reserves by the end of FY 2017-18.

Standing outside the State Office Building in downtown Syracuse on Wednesday, the Greens appealed to Sen. John DeFrancisco to become the last vote needed in the state senate pass the bill. With the election Tuesday of single-payer supporter Brian Benjamin for the vacant state senate seat in Harlem, supporters of the NY Health Act are now only one vote short of passing the bill in the Senate, according a whip count by the Campaign for New York Health.

The Assembly passed the bill by a 94-46 margin on May 16. Three of the four state legislators representing the city of Syracuse support the New York Health Act, including Assemblymembers Pam Hunter and Bill Magnarelli and state Senator David Valesky. State Senator John DeFrancisco has been opposed.

The Greens estimate that the New York Health Act would save the city $42 million a year in current and retired employee health care costs and the school district would save $38 million a year on current employees' health care costs, for a total of $80 million in savings for the combined city and school district budget.

The county would save $54 million in employee health care costs and $98 million in Medicaid costs, for a total savings of $152 million, according the Greens' estimates

“We are appealing to John DeFrancisco to be a hero, to be the deciding vote that saves the city from insolvency and saves local governments throughout his district tens of millions of dollars, including the $98 million unfunded state mandate for county Medicaid payments that eat up 70% of the county's $140 million property tax levy,” said Howie Hawkins, the Green Party candidate for mayor of Syracuse.

“The New York Health Act would make the New York economy, which now has the second highesthealth insurance costs in the nation, more competitive by lowering health care costs for businesses as well as government employers. It would also enable unions to take health care largely off the bargaining table and focus more on wages, working conditions, and pension benefits in contract negotiations,” said Frank Cetera, the Green Party's candidate for councilor-at-large, a business advisor at the Onondaga Community College Small Business Development Center, and a teachers union steward and delegate to the Greater Syracuse Labor Council.

Rahzie Seals, the Green candidate for 4th district councilor who works in the hospitality industry, said, “I need this plan and so do a good portion of the people in the 4th district. When we have coverage in our jobs, it is often limited and costly. And in an industry with high turnover and frequent layoffs, we are often without coverage between jobs. This plan will save us money and give us peace of mind.”

The Greens made their estimates using figures from the most recent city and county budgets and financial statements and a cost analysis by economist Gerald Friedman (Economic Analysis of the New York Health Act, April 2015). Friedman's analysis found that employers would pay an average of 8% of payroll. The city payroll is $118 million, the school district payroll is $226 million, and the county payroll is $240 million. To determine the savings, the Greens subtracted 8% of those payrolls from current health care costs – $51 million for the city, $56 million for the school district, and $73 million for the county. The difference between 8% of payroll and current costs is the estimated savings. The city number includes the legacy costs for retired employees. The school district and county figures do not include these legacy costs, meaning the actual savings are greater than the Greens' estimates. The county also saves $98 million in state-mandated Medicaid expenses.

The Greens' estimates assume that the government employers pay for all of the payroll taxes. The legislation actually requires employers to cover 80% of the payroll tax and with employees having the remaining 20% deducted from their wages or salaries. However, employers are permitted to pay part or all of the employees' share as an added benefit, which could be the result of a collective bargaining agreement. The Greens' estimate of savings is conservative because it assumes city, school district, and county employers will pay for 100% of the payroll tax.

The savings to local governments in New York has been a big selling point for the New York Health Act with municipal officials and state legislators. Albany city treasurer Darius Shahinfar has noted, “For taxpayers, we have an enormous hidden health care 'tax' in our property taxes. And the truth is this hidden tax is bleeding property taxpayers dry. . . . Astonishingly, health care costs are nearly half of our city tax bill, a quarter of our school district's tax bill and more than the entire amount in a county tax bill.” He said that with passage of the New York Health Act “every taxpayer in every municipality in New York would see similar, massive savings.”

The New York Health Act would cover all New Yorkers, including the 1.2 million people (6% of New Yorkers) who are uninsured.

The Act would save $70 billion for New Yorkers in 2019, a savings of 25% from projected health care costs. The savings and expanded coverage would be achieved through ending monopoly pricing by drug and medical device companies, administrative savings and reduced fraud from billing simplification, and eliminating private insurance company profits.

The plan would cover all medically necessary services with no out-of-pocket expenses, including:

doctor visits

hospitalization

primary and preventive care

reproductive care

dental

optical

hearing

mental health

prescribed occupational and physical therapy

rehabilitative care

lab tests

prescription drugs

medical devices

Long term care will be added to the benefits within two years of adoption.

The Green Party state committee voted on May 20 to make the campaign to enact the New York Health Act its top priority. It has a webpage at www.gpny.org/healthcare with downloadable leaflets, petitions, and other resources.